Stan Original 'Bump'.

A House of Representatives committee has recommended the Federal Government introduce legislation that requires streaming services to spend at least 20 per cent of their local revenue on new Australian content.

In a report released on Wednesday, the Communications and the Arts Committee made a total of 22 recommendations to support the recovery of Australia’s arts and cultural sectors from the impacts of the bushfires and COVID.

Among them was that over-the-top (OTT) media services, such as Netflix, Stan and Disney+, allocate at least 20 per cent of their local revenue on new Australian drama, documentary, children’s content, commissions, co-productions or acquisitions of content.

According to the report, which was requested by Minister for Communications, Urban Infrastructure, Cities and the Arts Paul Fletcher in August 2020, the new legislation should also stipulate that at least 20 per cent of the 20 per cent quota go towards local children’s content and drama.

It’s the first time a government report has suggested a mandate of this scale and comes almost a year after the release of the media reform green paper, which put forward that SVODs and AVODs invest a percentage of their revenue on Australian content in the form of commissions, co-productions, and acquisitions.

In the industry consultation that followed, Screen Producers Australia, the Australian Directors’ Guild, and the Australian Writers’ Guild joined other guilds and associations in pushing for a regulatory model in which SVOD and AVOD services with at least 500,000 subscribers or $50 million in annual Australian revenue be required to spend 20 per cent of that revenue on local commissions.

A coalition of Australian children’s producers comprising representatives from 30 companies also called for a 20 per cent children’s sub-quota to be placed on streaming platforms, based on an overall 20 per cent revenue-based local content requirement.

While Stan, Amazon, and Netflix each expressed concern about the prospect of obligations in the submissions to the green paper, data from the Australia Institute released in August showed 60 per cent of Australians supported the 20 per cent local spend.

In welcoming the recommendations, SPA CEO Matthew Deaner thanked the committee for its “thoughtful response” to issues within the sector.

“In particular, the report recognises that Australia’s screen sector is a major cultural industry which creates jobs, promotes Australia to audiences overseas and is a ‘nation-building asset’,” he said.

“The importance of screen content production to regional economies, in terms of local investment, showcasing regions and encouraging future tourism is also a highlight of the report, as is the recognition of the cultural and economic power of Australian children’s content.”

“Of critical importance, however, is futureproofing the regulatory environment for the sector, and this is explicitly supported by the landmark recommendation for a 20 per cent Australian content expenditure requirement on streaming services.”

Communications and the Arts Committee chairperson Anne Webster said the recommendations in the report would support the recovery of the industry, maximise employment, and contribute to economic growth.

“A healthy, sustainable arts industry will allow Australia’s creative and cultural industries and institutions to emerge from the COVID-19 public health emergency and allow Australia’s arts to reach new heights,” she said.

A spokesman for the office of Mr Fletcher said the government will “consider the report in the usual way”.

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